If you believe chaos theory, then a butterfly flapping its wings in Tokyo can cause a tornado in Texas; there’s no need for a monstrous Godzilla to make waves. This meteorological analogy has market ramifications, as a tiny tick up in services inflation in the US is causing something akin to a financial typhoon in Japan.

OK, that may be overstating it a little, but it’s true that the Japanese yen has taken another dramatic dive following US inflation data earlier this week, which had the effect of boosting US rates and strengthening the dollar against more or less all comers. The yen is back to beyond 150 per dollar, for the third time in 15 months. Before that, it hadn’t reached that landmark in three decades:

QOSHE - Butterfly or Godzilla? Chaos and the Falling Yen - John Authers
menu_open
Columnists Actual . Favourites . Archive
We use cookies to provide some features and experiences in QOSHE

More information  .  Close
Aa Aa Aa
- A +

Butterfly or Godzilla? Chaos and the Falling Yen

28 2
15.02.2024

If you believe chaos theory, then a butterfly flapping its wings in Tokyo can cause a tornado in Texas; there’s no need for a monstrous Godzilla to make waves.........

© Bloomberg

Get it on Google Play